Hi As I am fairly new to stacking I am surprised at the high premiums paid for some silver and the varying premiums (especially on Ebay). Some coins and bars are less popular than others for no real reason but some are obviously rarer which accounts for the difference, but what will happen when the price of silver does skyrocket? I can see that premiums will no longer be an issue - an ounce of silver will be valued at an ounce. I remember when the price of gold peaked in 1980 and people were lining up outside the Perth Mint to melt down their gold plated jewellery, antique jewellery etc. All 'aesthetic value' became irrelevant.
Silver is still silver and generally has the baseline spot value. The trick is to find the out-of-favour items and get them while they are cheap. I love britannias but i'm not going to invest all my money in those when for the same money i could be getting extra ounces in purchasing other items. I just get some of these coins to play with.
This is a great point and why I don't buy high premimum/numi Silver... e.g buy a Koala today ~$44 buy ,a Proof Koala with COA today ~$88 ...in X number of months/years,will the 2:1 ratio maintain? i.e will the Proof be worth $200 when the round is $100? possibly...ok what then when the round is $1000 - would the proof be worth $2000? how many buyers could you find? These might not be fair figures to compare,but I'm sure you get my point - during a Bull market, premiums will shrink (or at least max out) at a certian level - an ounce stacker percentage wise would do better IMHO Above isn't a stab at those who choose these items...just my opinion...
To my mind if you are only stacking silver for the sake of cashing in if the price skyrockets and not because you love and appreciate coins for their beauty or rarity, then it would be wiser to shop for the cheapest silver (lowest premium silver) on the market regardless of popularity - but also silver that is recognised world wide and probably bars or coins that are not so easy to counterfeit! I can see that when the price does escalate there will be a lot of counterfeiting going on. Any coin that has a reputation for being copied will not be so eagerly traded especailly on places like Ebay.
Yeah sure gold jewellery that goes to get melted will lose aesthetic value - i can agree with that. This is becuase these do not have a heavy secondary market and are not scarce or in demand. With regard to your statement about Silver, i only envisage what you say to be true in a SHTF scenerio where bartering becomes commonplace and fiat and banks are no more. Other than that, in a market that is still operable there will always be premiums over spot for 1 oz bullion such as kooks, libs, ases, brit etc. IE: if spot is $100, these coins will proberbly attract a spot +$5 premium over. Whereas Buffalos and 1966 50's will continue to be available very close to spot. If you are smart with the silver you buy at a premium, not only will you get the premium back, you will find your investment has apprecated far beyond spot. Effectively investing wisely within the realm of silver investment can reaps far greater benefits. IE: buy a lunar tiger for $4 over spot for $25... at the time you could of got 3 1966 50's or a buffalow for $21... but paying the extra $4 has earned you addtional porfits when you come to sell.. Regardless of if spot is 20, 50, or 100 ... an in demand coin will always dicate a highj premium than a coin with less demand and greater supply. In Summary, spot should not effect bullion prices for say 1/2, 1 oz, 2, oz type stuff.. so i disagree spot has a strong relationship with the ability to get premiums and i also disagree that if spot gets to high that it was a poor decsion to purchase limited coins in high demand. I have heard this argument but i dont see ANYONE EVER selling there lunar dragons at spot OR any other decent product.. If that were the case id sell my generic and junk at spot and just hold the rare stuff that everyone loves *(and im guessing everyone else would with no incentive) 1for1
Hi, yeah sure proofs are not a pure silver investment so if you sell your proofs as silver you obviously wont get much above spot... Proofs are more sold as numismatics for people who collect proofs, In a fickel world economy where Numismatic premiums are dependant on wealthy investors.. Liquidy of proofs and an ability to get back your inital purchase or for there worth to continue rising would be heavily compirimised. With BU Silver at $4-10 like lunars... id say these are going to maintain there worth regardless (even in a SHTF scenerio i would do a strait swap dragon for a buffalo.. would you?) Its a numismatic investment more dependant on secondary market demand. Exactly the same as a florin collector where the 1914 H florin where the silver content is a fraction of its worth.. he/she would never line up outside Perth Mint to get spot for it. Common sense should prevail on this and defining what asset class we are actually investing in is vital.. this is why peter Schiff says to steer clear of NUMISMATICS if you are investing in Gold/Silver 1for1
you could also take the view when you are selling that your premium fetching coins may sell more easily than a silver round, if silver goes to $100 the percentage gain is still quite handsome even if having to sell at spot or just above
Quite true hiho - higher premium coins could sell more easily but there is also the 'panic to sell aspect'. If silver is very volatile there could be a panic to lock in the highest price by selling back to the Mint to melt rather than wait for a buyer I know I have done this myself with gold nuggets in the past when gold was going up $30 a day. So if you are the type of person to panic in a volatile market and you happen to live near the Perth Mint or a bullion refiner maybe stick to the cheaper silver options!
Not a big numistics guy but I do buy some stuff. My main priorirty is stacking at this point. When I join the 1000 oz club then maybe I'll buy more rare stuff but I'm nowhere near there.
The point is you buy 1 proof for your collection and 500 for your stack, but every time the this issue come up is distorted like someone sacking proof coins instead of bullions
I tend to buy the normal bunch of 1oz coins as my idea is to build up a stack. What I then find as a stacker, which is also a hobby, I tend to go for at least one each of the collector coins like pandas, cats, wolves etc. just to round out the stack. Then I found by mixing in the right circles, you come across a few specials in the area of collector coins which you can buy low, then sell high to increase your stack. Finally, I reckon you're better off buying coins rather than a round, for the extra dollar or two. Legal tender will have better trading value when the SHTF.
If you can get 0.925 sterling silver coins close to the spot price of the actual silver content would you buy ? People are paying sometimes crazy premiums on common .999 silver bullion coins, but .925 ( usually proof quality ) always seem much cheaper per oz even after adjusting for the difference in alloy.
I did/do. The Masterpieces in Silver are still some of my favorite sets... though I've sold a lot of them off in preference of pandas. The MIS sets are .925 and can often be found at reasonable prices. I also still go for the $10 State Series and Bird Sets whenever I find them at a good price.
I've bought some .925 junk silver (pre 1919 canadian coins and a cayman islands coin) at pretty much spot or less. I draw the line at canadian coins at .800. I don't mind if its not .999 especially if its a bargain. I say round out you stack with bars, junk coins, .999 govt issued (ie: maples, ASE's, Kooks etc.) And even sterling flat ware or jewellry. If the prices skyrocket you'll be happier to have more weight and variety than having less ounces of a higher premium coin.
I am doing the same stacking with the basic well known 1 oz coins and any silver I can get get close to spot even sterling, I will buy more rare ones if I can get a bargain, and I agree that it is better to pay a little more for coins over rounds as they will be easier to trade if SHTF. As sargeant says, I think more weight in silver will be better than high premium coins if SHTF and silver skyrockets but stacking the rarer coins could win out if you are able to hang on to them for the long term. Going on human nature though I reckon there will be a lot of panic selling when silver either takes off or plunges.
